See also previous blogs from June.

We were getting interested in this stock when it was trading around $6 and here we are at $4.50 , or so. Two counts present themselves. The one in black requires a large C wave down and the one in beige a double zig-zag. Given how close we are to the bottom no other alternatives are readily availabe. We prefer the double zig-zag, the one in beige. All trend lines come together where the cross is , about $4, which also coincides with a possible 4th wave of previous degree. The stock yields about 11% and it used to be one of the most desired income trusts. On balance a buy.

Pengrowth traded below $6 today, a level we anticipated more than a year ago. This level corresponds to the low in March of 2009. The distance travelled in the 5th wave is now equal to the distance travelled in 1 and 3 combined. Buying at $6 certainly beats buying at $14

tPengrowth is one of the oldest energy trust structures, as well as one of the best. Unfortunately it is difficult to get long-term charts for these companies as they changed their legal structures and most chart services then start all over as if the company had not existed before. There are two previous entries on this stock, the earliest is from Jan. 24, 2011. We recommended a sell after the $14 level for several reasons (see that blog). Had you done so you would have saved 50% more of your money. At the time the a-b-c from the May 2009 low was assumed to be a wave 4. We have reason to change that count but the ultimate target is about the same ( as then < $6). Here is the chart;

The a-b-c X a-b-c structure now makes the most sense. This is essentially a double zig-zag which occurs when the first bear market was not enough, it is then followed by a second one and sometimes even a third. More detailed charts below;

From $26 to $6 would be a 78% drop, certainly enough for a real bear. Equality between c and a occurs at around $6. Wave 5 equal to 1, if indeed it is a 5-wave sequence gets you just a little lower. As all upward moves are a-b-c countertrend moves the trend is still down so at some point we should get a new low (barring a failure). Considering that you are a single dollar away from a possible low selling now does not make sense. Buying should if you are willing to hold but waiting a little might help get a better entry.

The Jan 21 chart is on the left , today’s on the right. It is down 30%.  Just as with the TSE, this one could just keep dropping or pause for a month or so and then continue down. In the end it should go below $6.